Interim Results Presentation August 2019 - Henry Boot PLC

 
Interim Results Presentation August 2019 - Henry Boot PLC
Interim
Results
Presentation
August 2019
Interim Results Presentation August 2019 - Henry Boot PLC
Agenda

                    Investment Proposition     page 1
                    Operational Highlights     page 2
                    Financial Review           page 3
                    Land Promotion             page 10
                    Property Investment        page 15
                    & Development
                    Construction               page 18
                    Investing for the Future   page 20
                    Outlook Summary            page 21
                    Appendices                 page 22
                    The Henry Boot Way         page 30

Interim Results Presentation
August 2019
                                                         Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration
Interim Results Presentation August 2019 - Henry Boot PLC
Investment
               Proposition
                     Strong financial track record over the long term.

                     Long established with an efficient capital structure.

                     Robust Group structure through diversity of operations.

                     Low gearing allowing opportunistic land and
                     property acquisitions.

                     Incremental shareholder dividends and NAV growth
                     through retained earnings.

                     Land portfolio held at cost with no recognition
                     of planning gain on 15,427 plots.
                     £1.6bn pipeline of property development opportunities.

Interim Results Presentation
August 2019
                                                                             Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 1
Interim Results Presentation August 2019 - Henry Boot PLC
Operational
Highlights                                                          Interim Dividend
                                                                    to 3.7p
                                                                                                      NAV
                                                                                                      233p per share

 Good start to 2019 with a very resilient
 result, given current uncertainties affecting
 the UK economy.                                        16% 2.6%
 Strategic land portfolio of 14,077 acres,15,427
 units permissioned, 10,570 units in planning                       2,148                              GDV Pipeline
 process. 15 land disposals for 2,148 plots.                        Plot disposals

                                                        13% £1.6bn
 £333m Aberdeen scheme achieved
 practical completion on 2nd August,
 in line with expectation and on budget.

 GDV of current development schemes
 in delivery over £850m, with over £480m
 delivered since 2017.
                                                                    14,077 Acres                       95%
                                                                                                       construction
 Estimated GDV of opportunity pipeline                                                                 activity secured
 circa £1.6bn.

 68 unit sales by Stonebridge Homes.

 95% of annual construction activity secured,
 71% of 2020.
                                                        2% 12%
 Interim Results Presentation
 August 2019
                                                   Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 2
Turnover                                             Trading Profit

  Financial
                                              2019                                    £189.0m        2019                               £24.4m

                                              2018                                         £196.2m   2018                                  £24.8m

  Highlights                                  2017

                                              2016                    £107.3m
                                                                                           £195.4m   2017

                                                                                                     2016
                                                                                                                                        £24.6m

                                                                                                                                     £21.6m

                                              2015              £79.2m                               2015            £11.8m

       Turnover remains strong at £189m,               Profit Before Tax                                    EPS
       supported by Aberdeen project.         2019                                    £24.1m         2019                               14.2p

       Trading profit underpinned by strong   2018                                         £26.2m    2018                                       15.7p
       land sales.                            2017                              £22.6m               2017                          13.1p

       PBT at £24m reflects a good start      2016                       £20.8m                      2016                  11.9p

       to the year.                           2015                    £14.0m                         2015          7.8p

       EPS 14.2p supports our 3 times
       dividend cover policy.
                                                        Full Year Dividend Per Share                        NAV Per Share
       Interim dividend of 3.7p, up 16%.
                                              2019   3.7p                                            2019                                   233p
       Net debt £50m, 16% gearing.            2018   3.2p      5.8p                 9.0p             2018                               217p

                                              2017   2.8p    5.20p           8.0p                    2017                        184p

                                              2016   2.5p   4.50p        7.0p                        2016                     171p
                                                                                           HY
                                              2015   2.3p   3.80p     6.1p                 FY        2015                 160p

Interim Results Presentation
August 2019
                                                       Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration             page 3
Financial
Segmental Revenue                                                                                                8      %
                                                                                                            Land Promotion

 Land Promotion revenues higher due to increased
 number of plot disposals.
                                                                                                            HY 2019           HY 2018
 Higher activity levels in Construction as Barnsley                                                         £38.7m            £35.7m
 town centre phase 2 commences. Additional works

                                                                                                        11
 undertaken by Road Link for Highways England to
 design two new roundabouts.
                                                                                                                      %
 Property Investment and Development revenue down,
 but offset by Stonebridge house sales.                                                           Construction

                                                                                                  HY 2019                HY 2018
                                                                                                  £54.1m                 £48.9m

                                              14           %
                                        Property Investment and Development

                                        HY 2019                                      HY 2018
                                        £96.2m                                       £111.6m

 Interim Results Presentation
 August 2019
                                                                          Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 4
Financial
Segmental PBT

                                                                                  26                                                   1
 Land Promotion returns
 maintained from disposing
 of 2,148 plots, up from                                                                         %                                              %
                                                   32
 1,904 in 2018, but at a lower
 blended gross profit per
 plot sold as more planning
 promotion sites sold.
                                                                  %               Property Investment
                                                                                  and Development
                                                                                                                                       Land Promotion

                                                   Construction
 As expected, Property
 Investment and Development
 returns lower, as new
 sites start to conclude
 infrastructure phase.

 Construction returns higher
 due to better margins and
 an increased level of activity.

                                   HY 2019 £5.4m      HY 2018 £4.1m   HY 2019 £6.4m        HY 2018 £8.6m                 HY 2019 £15.3m         HY 2018 £15.5m

 Interim Results Presentation
 August 2019
                                                                      Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration          page 5
Financial                                                                                                            2019           2018

Balance Sheet                                                                                                   Half Year
                                                                                                                     (£m)
                                                                                                                               Full Year
                                                                                                                                    (£m)

                                                                              Intangible assets                       4.9           5.1
                                                                              Property, Plant and Equipment          28.6          26.2
                                                                              Investment Properties		                79.1         121.0
                                                                              Investment in joint ventures            6.8           6.7
                                                                              Trade and other receivables             8.6          11.9
                                                                              Deferred tax assets		                   3.7           3.4
                                                2019        2018
                                           Half Year   Full Year              Fixed Assets			                       131.7         174.3
                                                (£m)        (£m)
                                                                              Inventories                            170.2
                                                                                                                   				           155.0
                                                                              Contract Assets                         50.7         42.8
Group occupied (Investment) property			         7.9         7.9
                                                                              Trade and other receivables             71.4         60.2
Equipment held for hire                        10.3        14.1
                                                                              Cash and cash equivalents                8.0         10.8
Right of use assets                             6.6           –
                                                                              Assets classified as held for sale		    43.5            –
Vehicles and office equipment		                 3.8         4.2
                                                                              Current Assets			                     343.8         268.8
Property, Plant and Equipment Total            28.6        26.2
                                                                              Borrowings                            (58.3)        (29.2)
Completed investment property			               74.6       117.6               Retirement benefit obligations        (18.3)        (16.7)
Investment property under construction		        4.5         3.4               Other liabilities		                   (88.1)        (94.9)

Investment Properties Total		                  79.1       121.0               Total Liabilities		                 (164.7)       (140.8)

Developments in progress			                    39.1        24.6               Shareholder equity                    308.5         299.2
House builder land and work in progress        27.6        22.5               Minority interests                      2.3           3.1
Land held for development or sale              56.6        58.8
Options to purchase land                       14.2        16.5               Total Equity		                        310.8         302.3
Planning promotion agreements                  32.7        32.6
                                                                              Net debt                              (50.3)        (18.6)
                                                                              Gearing (debt/equity)                  16%            6%
Inventories Total                             170.2       155.0
                                                                              NAV per share		                        233p          227p

     Interim Results Presentation
     August 2019
                                                                   Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 6
Financial Pensions
                               Initial triennial valuation results deficit £19m. Recovery
                               plan contributions £3.25m rising to £3.75m over 5 years.
                               Regulator becoming increasingly formulaic and driving
                               reduction in risk and therefore asset returns.
                               IAS 19 deficit at 30/06/19 £18.3m, asset performance
                               +8.8% in period, however discount rate now 2.2%
                               (31/12/18 2.8%) effectively increasing liabilities by £19m.
                               Gross assets of £185m.
                               Long term investment return (since 03/2010) 7.8%,
                               breakeven return 3.8% (trending downwards).

                               90%
                               80%
                               70%
           Cumulative return

                               60%
                               50%
                               40%
                               30%
                               20%
                               10%
                                0%
                               -10%
                                      Dec 2010

                                                 Jun 2011

                                                            Dec 2011

                                                                       Jun 2012

                                                                                  Dec 2012

                                                                                             Jun 2013

                                                                                                        Dec 2013

                                                                                                                   Jun 2014

                                                                                                                              Dec 2014

                                                                                                                                         Jun 2015

                                                                                                                                                    Dec 2015

                                                                                                                                                               Jun 2016

                                                                                                                                                                          Dec 2016

                                                                                                                                                                                     Jun 2017

                                                                                                                                                                                                Dec 2017

                                                                                                                                                                                                           Jun 2018

                                                                                                                                                                                                                      Dec 2018

                                                                                                                                                                                                                                 Jun 2019

                                                       Scheme                                Breakeven return

Interim Results Presentation
August 2019
                                                                                                                                                                                                                                            Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 7
Financial
Cash Generation &
Movement in Net Debt                                             Operating
                                                                 Profit
                                                                                                     Depreciation,
                                                                                                     Amortisation
                                                                                                     & Impairment
                                                                                                                                    Inventories

 Non-cash adjustment for depreciation, amortisation
 of plant and Road Link investment £3.1m.
                                                                 £24.7m £3.1m                                              £15.3m
 Inventories increased as we invested in house building
 land and WIP and property development opportunities.                       Net                             Net                            Tax
                                                                            Payables/                       Interest
 Receivables increased as a result of land sale debtors                     Receivables                     Expense
 and the levels of forward funded pre-sold property
 development, mainly at Aberdeen and Markham Vale.

 £0.4m net interest expense reflects low interest rates
 and prudent gearing.                                            £26.6m £0.4m                                             £3.9m
 Tax paid of £3.9m.
                                                                             Net
                                                                                                            Net
                                                                                                            Capital
                                                                                                                           Net Cash
 Dividends £9.4m.                                                            Dividends                      Outflow        Outflow
 Net Capital outflow £4.1m as we invest in plant
 hire assets.

 Resulting in net cash outflow of £31.9m and increase
 in net debt to £50.3m.
                                                                 £9.4m                        £4.1m                       £31.9m

 Interim Results Presentation
 August 2019
                                                          Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration      page 8
Financial
        2019 Guidance
        Revenue          Construction
                         Segment could be up circa 10% as Barnsley
                         Phase 2 commences.

                         Land
                         As always, is a function of site mix, currently
                         expected to be down 20% due to increased
                         agency disposals.

                         Property
                         We could see a 15–20% decrease as Aberdeen
                         concludes in August. Offset by around a 10%
                         uplift in Stonebridge activity.

        PBT              The Board’s expectations for the full year
                         remain unchanged but are reliant on satisfactory
                         completion of development projects and, as ever,
                         conclusion of key strategic land disposals.

        Cash             Continued investment in land and property circa
                         £30m+ asset disposals £45m+ expect net funds
                         at year end.

Interim Results Presentation
August 2019
                                                                            Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 9
Land
         Promotion
               Profit £15.3m (2018: £15.5m), 15 deals
               completed and 2,148 plots sold in period.

               Strategic land holdings of over 14,077 acres.
               Investment totalling circa £104m.

               Sites with planning permission for 15,427 units.

               Planning consent won over the year 1,086
               (HY 2018: 436).

               Planning submitted and in progress on 23 schemes,
               circa 10,570 units.

               Continuing to acquire new schemes to replenish
               land bank. Board approval granted for 19 new sites
               in the year, over 6,490 plots and 500 net acres.

Interim Results Presentation
August 2019
                                                                    Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 10
Land Promotion
Inventory
   Gross profit of £128m from 11,262 plots over 4.5 years
   at an average of £11.3k per plot.

Land Bank

        Owned Acres                         Agency/Optioned Acres                    Total
Jun19 1,412                         Jun19                                12,665     14,077
Dec18    1,562                      Dec18                                12,763     14,325
Dec17     1,608                     Dec17                            11,665         13,273
Dec16           1,749               Dec16                          10,139           11,888
Dec15               1,804           Dec15                        9,257              11,061

        Average cost per acre
        Owned £38k                           Agency/Optioned £4k                  Total £8k

        Plots                             Of Which Permissioned               Plots Sold in Period                     Gross Profit Per Plot Sold £000’s           Profit Before Tax
Jun19           25,997            Jun19              15,427          Jun19              2,148                  Jun19      £7.4                             Jun19           £15.3m
Dec18                28,418       Dec18                 16,489       Dec18                           3,573     Dec18        £9.4                           Dec18                       £28.5m
Dec17            26,511           Dec17                  18,529      Dec17               2,169                 Dec17               £13.0                   Dec17                 £23.1m
Dec16              26,869         Dec16              16,417          Dec16          1,609                      Dec16                       £14.7           Dec16             £17.7m
Dec15             26,811          Dec15        12,043                Dec15           1,763                     Dec15                       £15.0           Dec15               £19.1m

   Interim Results Presentation
   August 2019
                                                                                                 Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration          page 11
Land Promotion
Average Returns
                                                                   2,792

                                          Plots Sold                                                                      Average Gross Profit Per Plot £000
                                                                                 1,484                30
          1,500
                                                                                                                25
                                                          1,025
                                                                                                      23
                                         1,186   1,144
          1,000                                                                                                                                     19              19
                                                                                                                          15               15                                    13
                    963      800                                                                      15                            16                     13
                                                                           781
                                                                                           664
          500                                                                                                                  11                                        9
                                                                                                      8                                         8                                     7
                                   423
                                                                                                               7                                                7            5

          0                                                                                           0
                          2015       2016          2017           2018           HY 2019                           2015             2016            2017            2018     HY 2019

                Option/Agency       Owned                                                                  Option/Agency             Owned           Total

 Interim Results Presentation
 August 2019
                                                                                                 Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration                  page 12
Land Promotion
Inventory
30 June 2019 Interim

Company Land Interests            Company Land Control
(Acres)                           (Acres)

   Region              Acres                     Acres

   South West           2,784        Agency      10,031

   South East           1,792        Optioned     2,634

   South Midlands       3,840        Purchase     1,412

   North Midlands       3,250                    14,077

   North West             368

   North East             756

   Scotland             1,287

                      14,077

   Interim Results Presentation
   August 2019
                                                          Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 13
Land West of
Shilton Road
Burford
Land Promotion Current Site
The medieval settlement of Burford is located about 18
miles west of Oxford in the Cotswolds. In 2014 HLM
secured a Planning Promotion Agreement in relation to
17 acres south west of Shilton Road, and commenced
it’s planning promotion with a public exhibition.

As a result of the exhibition; landowner requests; and
discussions with the planning authority, rather than
pursue a pure residential scheme for circa 150
dwellings, we pursued an outline application for:

    91 residential plots
    64-bed Retirement Complex
    90-bed Care Home.

Planning was granted on appeal in 2017 and HLM
subsequently sold the residential element of the site
to Lioncourt Homes, and have contracted to sell the
Retirement complex to another party later this year.

    Interim Results Presentation
    August 2019
                                                         Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 14
Property
         Investment &
         Development
               Investment property portfolio of £79m following transfer
               of £44m to assets held for sale expected to be disposed
               of in H2, mainly retail and mixed use.

               Target hurdle rate of 12%–15%. Lower returns when
               pre-let and pre-funded, higher value where we take
               more risk.

               GDV of schemes in progress over £850m, over 90%
               pre-let, pre-sold and pre-funded. £483m delivered
               since 2017. Circa £1.6bn of opportunities progressing.

               Increased levels of due diligence slowing commercial
               property development commencement. Possibly due
               to EU negotiations as people wait to see the result.

               Stonebridge Homes achieved 68 unit sales (2018: 53)
               targeting 1,000 p.a. over a ten year period.

Interim Results Presentation
August 2019
                                                                          Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 15
Project
                                                                                                      5 Years

                                                                           2017               2018             2019                 2020                 2021

Delivery
                                  Aberdeen                                             £334m                          £2m

                                  Aberdeen                                                                                                               £60m

                                  Aberdeen, Bridge of Don                                                                                         £25m

                                  Bath                                                        £5m

Contracted Delivery               Birmingham, Cornwall House                                                                                             £25m

of Projects                       Bournemouth                                                                                                     £15m
Between 2017–2021                 Bristol                                                                             £10m

                                  Chesterfield                             £3m

   Mixed use                      Chippenham                                                                                                      £8m

                                  Epsom                                                £32m                           £5m
   Leisure
                                  Leicester, Melton Road                                                                            £11m

   Retail                         Leicester, Belgrave Road                                                                                               £10m

                                  Luton                                                                                                    £27m
   Industrial & Offices
                                  Manchester, Invicta                      £6m

   Residential                    Manchester, St Ann's Square                                                                                     £11m

                                  Markham Vale                                         £50m                                  £22m

                                  Monmouth                                 £2m
   Delivered
                                  Nottingham, Thane Road                                                                                          £20m
   To deliver
                                  Skipton                                                                                                         £16m

                                  Southend on Sea                                      £10m                                  £30m

                                  Sunderland                                                             £8m                               £36m

                                  Thorne                                   £5m

                                  Walsall                                                                                                         £19m

                                  York                                                 £28m                                                       £15m

                                  Total delivered/to deliver                           £483m                                           £367m

   Interim Results Presentation
   August 2019
                                                                Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration                  page 16
Airport
Business
Park
Southend
Property Investment
& Development

   Joint venture with Southend-on-Sea Borough
   Council, Airport Business Park extends to some
   50 acres and will deliver over 1 million sq ft of
   commercial business space. We were selected
   as joint venture partner by Southend Borough
   Council following a competitive OJEU process.

   Planning consent for the scheme has been
   obtained, and the first phase of infrastructure
   together with the relocation of the rugby club
   will be completed by the end of 2019.

   We have secured Ipeco as the first occupier
   for the site. Ipeco are a world leader in the
   manufacture of crew seats for the aviation
   industry who are investing in a new 125,000
   sq ft headquarters facility on the scheme, with
   construction expected to commence in early
   summer 2019.

   Interim Results Presentation
   August 2019
                                                       Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 17
Construction
 Division consists of Construction,
 Plant Hire and Road Link (A69).

                                                            11
 External turnover up 11% at £54.1m.

                                                                             %
 Trading profit ahead at £5.2m. Workloads
 good but taking longer to get on site,
 due to sorting out planning conditions.

 Road Link margin down due to
 design works for two roundabouts
 on a management fee margin for
                                                            External Turnover
 Highways England. 7 years remain
 on concession. Very solid underpin
 of segment returns.

 95% of 2019 construction activity
 secured. 71% secured for 2020.
 Now actively tendering larger
 contract sums £10m–£15m+.

 Plant market toughened in 2019,
 7% return on sales (2018: 9%)

                                             3%                  7% 42%
 Supported by profits on disposal.

 Majority stake acquired in Starfish
 Commercial, giving us access to             Construction        Plant               Road Link
 social and affordable housing market.
 Cost negligible requires working capital.             Return on Sales in H1 2019

 Interim Results Presentation
 August 2019
                                                                         Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 18
The Beacon
University of Hull
Construction Completed

   The new £8m sports arena, The Beacon, is part of
   the University of Hull’s £16m scheme to create a
   world-class sports centre.

   The Beacon is an innovatively designed 12-court
   international standard sports hall that makes full use
   of natural lighting, with seating for 700 spectators.

   The project also includes remodelling the existing
   Grade II listed sports centre into a state-of-the-art
   fitness gym with studios, together creating a world
   class hub to benefit students and the community.

   Interim Results Presentation
   August 2019
                                                            Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 19
Investing
for the Future
          Strategic Land                                                 Property                                                  Construction
          New site Board approvals                                       Stonebridge Homes                                         HY 2019 workload tendered
                                                                         residential land portfolio
                                                                                                                                                            £129m
                                                                                                                                                            Commercial/Retail
HY 2019                    6,490 plots                         HY 2019                                             939 plots                                84%

  2018                                          13,268 plots      2018                                       868 plots

  2017                                    10,791 plots            2017                                         880 plots

  2016                      6,603 plots                           2016                           679 plots

          Appraised returns of approvals                                 Recent HBD Board approvals
                                                                         working towards planning                                              £154m tendered

HY 2019                      £84m                                        300 unit PRS scheme in Manchester
  2018                                          £144m                    90,000 sq ft Industrial/Employment
                                                                         scheme in Bournemouth
  2017                              £107m                                                                                       £2m
                                                                         235,000 sq ft Industrial/Employment                   Housing
                                                                                                                                   1%
  2016                      £83m                                         scheme in Cirencester
                                                                         114,000 sq ft Office Scheme,                              £6m                         £8m
          Contracts exchanged for                                        Island site, Manchester                                 Custodial      £4m            Industrial
                                                                                                                                                               5%
                                                                                                                                      4%        Education
          2020–2023 completion                                           53,000 sq ft Residential scheme,                                       3%

                                                                         Cornwall House, Birmingham                                          £4m
          Cash £47m, gross profit £26m                                                                                                       Health
                                                                                                                                             3%

    Interim Presentation
    August 2019
                                                                                          Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration               page 20
Outlook
         Summary
               Continued higher capital allocation to land and
               property development.

               Strategic land performing well with outline permission
               on over 50 sites working towards disposal.

               Housebuilding market continues to be buoyant
               – good for land trading and Stonebridge Homes.

               Strong development pipeline, especially industrials
               and distribution, to be delivered over the next 5
               years and beyond.

               Strong construction order book with consistent
               returns expectation.

               Group currently trading well, but mindful of
               continued global political and economic uncertainty.

               No change to expectations for 2019, however as ever we
               remain reliant upon a number of deals getting across the line.

Interim Presentation
August 2019
                                                                                Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 21
Appendices

              Group Structure – Segment Composition

              Group Structure – Board of Directors

              Group Structure – Senior Management

              Corporate Social Responsibility

              Shareholding as at 29th July 2019

              Five-year Track Record of Strong Growth
              Henry Boot PLC Share Price vs Benchmark Indices

              The Henry Boot Way

Interim Presentation
August 2019
                                                                Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 22
Group
Structure
Henry Boot PLC, established over 130 years ago, is one of the
UK’s leading and long-standing property investment and development,
land promotion and construction companies. Based in Sheffield,
with regional offices throughout the UK, the Group is comprised
of three segments.

Land Promotion
Hallam Land Management Limited is the strategic land and planning
promotion arm of the Henry Boot Group. The company has been
acquiring, promoting, developing and trading in land since 1990.

Property Investment & Development
Henry Boot Developments Limited is a major established leading force
in the UK with its considerable experience and reputation in all sectors
of property development. Stonebridge Homes is a jointly owned company
engaged in residential development and serviced office space.

Construction
Henry Boot Construction Limited specialises in servicing both public and private
clients in all construction and civil engineering sectors with strong partnering
relationships in education, healthcare and custodial services, delivering new build
and refurbishment works. Banner Plant Limited offers a wide range of construction
equipment and services for sale and hire. Road Link (A69) Limited, a 30-year
contract with Highways England to operate and maintain the A69 trunk road
between Carlisle and Newcastle upon Tyne, with seven years remaining.

    Interim Presentation
    August 2019
                                                                            Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration   page 23
Group
Structure                (from left to right)
                         Peter Mawson                                  Jamie Boot                Tim Roberts to take up role of CEO
                         Senior Independent Non-executive Director     Chairman                  from 1st January 2020.
                         and Chairman of the Nomination Committee      John Sutcliffe            John Sutcliffe to retire from Board
                         Darren Littlewood                             Chief Executive Officer   on 21st May 2020.
                         Group Finance Director                        James Sykes
                         Joanne Lake                                   Non-executive Director
                         Non-executive Director, Deputy Chairman       Amy Oakley
                         and Chairman of the Audit & Risk Committee    Company Secretary
                         Gerald Jennings

Board of Directors       Non-executive Director and Chairman of the
                         Remuneration Committee

  Interim Presentation
  August 2019
                                                   Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration             page 24
Group
Structure

Senior Management

   Land                        Property                                                       Construction
   Promotion                   Investment &
                               Development

Nick Duckworth              Edward Hutchinson      Darren Stubbs                           Simon Carr             Giles Boot       Trevor Walker
Hallam Land                 Henry Boot             Stonebridge                             Henry Boot             Banner           Road Link (A69)
Management Limited          Developments Limited   Homes Limited                           Construction Limited   Plant Limited    Limited

     Interim Presentation
     August 2019
                                                             Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration         page 25
Corporate
Social Responsibility

 People                              Community                               Health & Safety                              Environment
     Our people are vital to          We continue to contribute                  Henry Boot PLC continues to                   We recognise that we have a
     the delivery of our strategic    to the social and economic                 focus on health and safety as                 responsibility and an obligation
     priorities.                      impacts to the communities                 our primary business priority.                to reduce the direct impact of
                                      in which we operate.                                                                     all our business operations on
     Engagement with our                                                         We remain committed to                        the natural environment, both
     employees and employee           We offer support to a wide                 providing a safe and healthy                  now and in the future.
     satisfaction are crucial to      range of charities and                     working environment for our
     continued improvement            organisations of all sizes,                employees, stakeholders                       Reducing our emissions is
     and success across all           by working to provide them                 and contractors.                              one way in which we hope
     our businesses.                  with donations that are of                                                               to achieve this.
                                      most benefit to them.                      We operate all our business
     We have established policies                                                activities on the principle that              Our aim is to create more
     for recruitment, learning and    We support an annual Charity               good management of health                     sustainable ways of undertaking
     the development of our           of the Year which is elected by            and safety is fundamental in                  our business operations to
     employees.                       our employees. In 2018 our                 creating a safe and healthy                   conserve energy, save money
                                      Charity of the Year was                    working environment and                       and deliver efficiency.
     As our businesses continue       Dementia UK and a total                    contributes to improving our
     to develop and grow, we          of over £30,000 was donated.               business performance.
     understand that by retaining
     and inspiring effective and                                                 Our Accident Frequency Rate
     committed employees, we                                                     performance remains strong
     can continue to deliver                                                     with an overall score (including
     excellence to all.                                                          subcontractors) of 0.05 per
                                                                                 100,000 hours.

 Interim Presentation
 August 2019
                                                                        Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration        page 26
Shareholders
                                                                                                                       37.1m, 28%
                                                                                                                       Main Institutional Shareholders

                                                                                                                       9.4m
                                                                                                                       Canaccord Genuity Group Inc.

                                                                                                                       5.5m
                                                                                                                       Fidelity Management & Research

                                                                                                                       4.2m
                                                                                                                       Polar Capital Holdings

                                                                                                                       3.4m
                                                                                                                       Standard Life Aberdeen
                        63.8m, 48%                          133m shares in issue                                       3.2m
        Henry Boot Founding Family                                                                                     BlackRock Inc.
               (across 91 holdings)
                                                                                                                       2.8m
                                                                                                                       Schroders

                                                                                                                       2.5m
                                                                                                                       Dimensional Fund Advisors

                                                                                                                       2.2m
                                                                                                                       Hargreaves Lansdown PLC

                                                                                                                       2.1m
                                                                                                                       Miton Group PLC

                                                                                                                       2.1m
                                                                                                                       Legal & General Group

                                         29.8m, 22%                                     1.8m, 2%
                                      Other Shareholdings                       Employees/Directors

 Interim Presentation
 August 2019
                                                                      Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration        page 27
Strong
Growth
Five-year                 Dividends Per                   Net Asset Value
                          Ordinary Share   Net Assets     per Share           ROCE               Profit Before Tax        Net Debt            Turnover
Track Record
2014–2018                 2014 5.6p        2014 £200.5m   2014 152p           2014 11.4%         2014 £28.3m              2014 £36.4m         2014 £147.2m
                          2015 6.1p        2015 £221.5m   2015 168p           2015 12.2%         2015 £32.4m              2015 £38.9m         2015 £176.2m
                          2016 7.0p        2016 £233.6m   2016 177p           2016 14.4%         2016 £39.5m              2016 £32.9m         2016 £306.8m
                          2017 8.0p        2017 £270.0m   2017 203p           2017 18.6%         2017 £55.4m              2017 £29.0m         2017 £408.5m
                          2018 9.0p        2018 £302.3m   2018 227p           2018 14.9%         2018 £48.6m              2018 £18.4m         2018 £397.1m

   Interim Presentation
   August 2019
                                                                        Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration      page 28
Share                                           320

Price
                                                300
Henry Boot PLC Share Price
vs Benchmark Indices

                                                280

                                                260

                                                240

Henry Boot PLC                                  220

FTSE 250

FTSE 100                                        200

FTSE All Shares

FTSE All Share/Construction & Materials – SEC
                                                180
                                                      Aug Aug Sep Sep Oct Oct Nov Nov Dec Dec Jan Jan Jan Feb Feb Mar Mar Apr Apr May May Jun Jun Jul   Jul   Jul Aug

                                                                      2018                                                    2019

    Interim Presentation
    August 2019
                                                                          Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration       page 29
The                                                                                                                Our Values
Henry Boot Way                                                                                                         Respect                             Integrity
Purpose, Vision and Values                                                                                             n We treat everyone in             n We operate with the
                                                                                                                          the way they wish to                utmost professionalism.
Henry Boot PLC, has been in business for over 130 years and our financial results                                         be treated.
and performance have always been, and will continue to be, dependent on our people.                                                                        n We champion ethical
We often use the phrase, ‘The Henry Boot Way’, to explain how we work and to                                           n We strive to always                 working.
describe what’s expected of us and others.                                                                                meet our commitments
                                                                                                                          and obligations.
Our Purpose                                                  Our Vision
To empower and develop our people to                         Our people, partners and communities
create long-term value and sustainable                       continue to trust our reputation, respect
growth for our stakeholders.*                                our expertise and value us for our                        Loyalty                             Delivery
                                                             forward-thinking approach.
                                                                                                                       n We are committed to              n We are relentless in
                                                                                                                          giving back to our                  delivering for our
                                                                                                                          communities.                        customer.

                                                                                                                       n We value the longevity of        n We deliver our best
                                                                                                                          our relationships with our         quality work for every-
                                                                                                                           people and our partners.           one, no matter what.

                                                                                                                       Adaptability                        Collaboration
                                                                                                                       n We are open to                   n We set clear mutual
                                                                                                                          opportunities to do                 expectations and strive
                                                                                                                          things differently.                 to achieve them.

                                                                                                                       n We are resilient,                n We work in partnership
                                                                                                                          have staying power.                 to make things happen.

*Our stakeholders are our shareholders, employees, pensioners, customers and suppliers.
More broadly, we recognise our duties to the environment and the communities in which we operate.

      Interim Presentation
      August 2019
                                                                                                         Respect | Integrity | Loyalty | Delivery | Adaptability | Collaboration        page 30
This presentation contains forward-looking statements.

                       Although the Group believes that the estimates and assumptions
                       on which such statements are based are reasonable, they are
                       inherently uncertain and involve a number of risks and uncertainties
                       that are beyond the Group’s control. The Group does not make
                       any representation or warranty that the results anticipated by such
                       forward-looking statements will be achieved, and this presentation
                       should not be relied upon as a guide to future performance.

                       Henry Boot PLC, Company No:160996. Registered in England and Wales.
                       Registered Office – Banner Cross Hall, Ecclesall Road South, Sheffield S11 9PD

Henry Boot PLC
Interim Presentation
August 2019
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